How 3 Jewelry Companies Are Thriving During the Downturn

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Los Angeles has long been known as a place where fashion designers and stylists are born and bred, but the area outside the City of Angels has recently become a hotbed for several successful jewelry companies.

Yes, jewelry companies. Yes, in this economy.

Jewelry businesses that primarily operate online have picked up speed during the recession, thanks to low costs for overhead, with no need for storefronts or extra employees. "What's great about online is it's global ... It's an instant global platform for your product," said Sharie Ellis of Love is a Devil, a year-old jewelry company based in the San Diego area.

Skipping the traditional bricks-and-mortar digs in favor of a virtual showroom isn't the only strategy that has helped some firms thrive. Here are the frugal strategies three companies have used to amp up exposure and juice sales during this tarnished economy.

Skipping the storefront and selling door-to-door
When best friends Evelyn Bernal and Katiria Delgado decided to launch a jewelry biz, Belina, in August 2010, their business plan did not include wasting precious start-up funds on pricey retail leases. Each partner works in her home office south of Los Angeles in Torrance, and Irvine, Calif.

Instead of selling their wares behind storefronts, they get exposure by staging trunk shows in the living rooms of potential clients.

Belina brings its baubles to house parties to complement a night of bachelorette debauchery or a girls- night-in soiree. With white wine flowing alongside enviable necklaces and rings, the women start spending. Belina has been able to consistently book house parties every weekend.

The perk of selling pieces face-to-face versus selling the pieces online is that the buyers can literally smell, touch, and feel the products, rather than clicking through pieces online.

Lower price points are also attractive to shoppers. Belina keeps its prices between $10 and $40, a relatively cheap range in the jewelry industry that targets females age 13 and up.

There are other perks to in-person purchases versus online shopping, as well. "The deal is there is no shipping costs, taxes or fees and it's there to try on," said Bernal.

Free word of mouth marketing
Marketing -- whether it's hiring a full-blown public relations firm or paying big bucks to advertise in print publications -- is a luxury many up-and-coming jewelry companies can't afford.

When Noon Designs opened on a residential street a block away from a San Diego beach, it barely generated the revenue to pay for its 260-square-foot, $600-a-month space in a converted one-car garage. As a result, founders Nora Alexander and Maie Liis Webb, who studied abroad in Slovakia and Switzerland during their college years at the Rhode Island School of Design, had to rely on their reputation to drive traffic into their store.

Now, just two years later, the company sells its products to 70 shops across the U.S., has two shops in Southern California, and about a dozen other designers' pieces in its stores.

"We believe these days in this down economy people want to support friendly faces and their local community," said Jessica Madore, who joined the company in late 2009 after she quit her lucrative marketing and sales job at a Portland, Maine, textiles firm to head west and pursue the California dream.

The first day she arrived in the sunny state, she stumbled across the San Diego garage the Noon designers were working out of.

Though Noon has since graduated from its humble beginnings, the company still heavily relies on word-of-mouth advertising to grow the business. "Honestly, it's been working. People come to us for gifts for their girlfriends, mothers, and grandmothers just as much as they do to treat themselves," said Madore.

Test-drive temporary digs
If you can't afford to sign a long-term lease, there's another option: Set up a pop-up boutique -- a temporary display inside an existing store.

That's the route taken by Love is a Devil, a young jewelry company that opened up a pop-up boutique in Temecula in February.

The founders, Alana Crain and Sharie Ellis, attended the Fashion Institute of Design and Merchandising together and named their brand after a Shakespeare sonnet as an ode to Crain's eclectic and edgy style mixed with Ellis' all-American, classic taste.

The pop-up boutique's proximity to celebrities -- it's just a two-hour drive from Rodeo Drive -- helps create foot traffic. Displaying its wares in prime real estate paid off: Taylor Armstrong, star of the Bravo TV hit Real Housewives of Beverly Hills, popped into Love is a Devil's pop-up store while she was visiting the surrounding wine country. The reality TV star gave the brand national exposure by wearing her chosen piece on an episode that ran this season.

Fool contributor Tierney Plumb appreciates your comments. She has no positions in any of the businesses mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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